MEC, allies continue to push DTE on rates, clean energy

DTE Energy’s attempts to significantly raise rates on residential customers and continue operating dirty, expensive power plants recently took a significant hit from an administrative law judge who issued a set of recommendations on the utility’s proposed rate case.

The recommendations from Administrative Law Judge Sharon Feldman were applauded by a variety of environmental and consumer advocate groups.

Among the key recommendations were:

• Reducing the overall rate increase to $99.94 million – a far cry from the $351 million DTE originally sought to charge customers.
• Lowering the share residential customers pay compared to DTE’s industrial clients. Currently, DTE’s residential customers pay nearly 9 cents more per kilowatt-hour than its industrial consumers – far above the national average. The ruling shifts about $8 million in costs from residential consumers to industrial.
• Requiring DTE to disclose the current and future costs of cleaning up its coal ash sites.
• Mandating DTE no longer recover expenses from investment in the outdated River Rouge plant. The utility had sought continued operation of the plant despite repeated analysis that shows it is no longer economic to run.
• Reducing DTE’s rate of profit from the requested 10.5% to 9.8%.

“This is an incredibly comprehensive and well-reasoned set of recommendations that should be a wake-up call to DTE to get serious about reducing rates and retiring expensive, uneconomic coal plants,” said Charlotte Jameson, the program director for legislative affairs, energy, and drinking water for Michigan Environmental Council. “We urge the Commission to embrace all of the ALJ’s recommendations and put DTE on a path towards more affordable, clean energy.”

The recommendations will be considered by the Michigan Public Services Commission. If the commission accepts the recommendations, DTE will be forced to follow them.

The decision comes as DTE was forced by the MPSC to create a new 15-year energy plan by April 1 that emphasizes clean, efficient energy.

MEC and other environmental and consumer advocacy groups pushed for better DTE rate and clean energy plans. They will continue to push for clean, accessible energy.

DTE’s policies that detail how much of the bill ratepayers foot for extending service to new customers, a factor in driving up rates for residential customers, were found to be too generous.

“In its proposed rate case, DTE wanted to continue with a business-as-usual model at the expense of residential customers,” said Amy Bandyk, executive director for Citizens Utility Board of Michigan. “Judge Feldman’s ruling made clear that business as usual won’t be tolerated and DTE has to create a fairer system that reduces the gap between what it charges its residential and industrial consumers.”

“Another win for residential ratepayers came from the judge’s ruling regarding its distribution system,” said Margrethe Kearney, senior attorney at Environmental Law & Policy Center in Grand Rapids. “We all know DTE has terrible reliability – among the worst in the country – and the judge said the utility must explain how money spent on distribution will actually improve reliability and responsiveness during storm-related outages. This performance-based model will help rein in costs that are mainly shouldered by residential ratepayers.”

The judge also ruled that the MPSC begin monitoring current and potential costs related to remediation of land and groundwater contaminated with toxic coal ash.

“Transitioning from dirty, inefficient power plants like Belle River and River Rouge must be addressed,” said Nick Occhipinti, government affairs director for Michigan League of Conservation Voters. “The judge took a step in the right direction by saying DTE can’t keep investing money into uneconomic facilities and expect ratepayers to foot the bill.”

The judge also recommended rejecting the utility’s proposed low-income renewable energy pilot program.